{"id":92337,"date":"2016-07-10T10:46:19","date_gmt":"2016-07-10T14:46:19","guid":{"rendered":"http:\/\/countingpips.com\/?p=92337"},"modified":"2016-07-03T10:46:42","modified_gmt":"2016-07-03T14:46:42","slug":"top-5-worst-trading-scenarios","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2016\/07\/top-5-worst-trading-scenarios\/","title":{"rendered":"Top 5 worst trading scenarios"},"content":{"rendered":"
July 10, 2016<\/div>
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By Admiral Markets<\/b><\/p>\n

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Dear traders,<\/p>\n

Most people set out to trade their own way and in doing so, end up being with the crowd that loses money.<\/p>\n

The questions is why?<\/p>\n

Well, perhaps when all your trading buddies and all the analysts you follow are talking about EUR going for 1.2000, it is hard to take a contrary view right?<\/p>\n

It is quite easy to say, “I’ll just follow the crowd and know when to exit my trade”.<\/p>

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But making that happen is something else entirely.<\/p>\n

And acting against that impulse for perceived easy money is hard, which is why crowds move together.<\/p>\n

Most hedge and mutual funds are followers too.<\/p>\n

They also take hits, along with retail investors and traders:<\/p>\n

… just not usually to the extreme of the uneducated trader\u2026<\/p>\n

…who is more likely to completely wipe-out his or her account when things go bad.<\/p>\n

Revenge trading<\/h2>\n

Anger is the worst possible emotion to apply to your trading:<\/p>\n

But then let’s face it – generally speaking, emotions per se have no real place in Forex trading.<\/p>\n

Revenge trading usually occurs after a loss – to win back the money you’ve just lost, by raising the leverage and making impulse trades.<\/p>\n

If it wins then rest assured, that you’ve effectively won by gambling and<\/em> you may try to repeat that win by gambling again.<\/p>\n

That’s bad, really bad – just ask the average casino player how well they do financially over the mid-to-long term.<\/p>\n

Quitting your dayjob to trade full time<\/h2>\n

Most aspiring full time traders, think they could live by trading off 10k USD.<\/p>\n

Well, they are partially right because they could live\u2026<\/p>\n

…but would probably be homeless.<\/p>\n

Until you have enough capital to ensure you get two-to-five per cent return on investment per month and<\/em> can pay your bills – don’t even think about full time trading.<\/p>\n

Having a golden reserve, is a must.<\/p>\n

Flipping out<\/h2>\n

It happens quite a lot.<\/p>\n

A trader makes a trade, the market goes against him, he loses a lot of money and he freaks.<\/p>\n

Then there’s usually a spiral of doom<\/a>.<\/p>\n

As the name suggests, doom is not a good place to be in.<\/p>\n

Working too much<\/h2>\n

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Forex trading is totally opposite to standard jobs.<\/p>\n

Less is more.<\/p>\n

Forex is about controlling your fear and greed on every trade.<\/p>\n

Sure these are natural traits of modern humans and you are not a bad person for feeling either one but:<\/p>\n

…acting on either one in trading, is financial suicide.<\/p>\n

Greed will drive you to take ever increasing risks and gamble.<\/p>\n

And fear will limit acting on good decisions.<\/p>\n

Remember, Forex trading is risky plus demanding – so you need a strong standing tripod<\/a> and technical skills<\/a>.<\/p>\n

Investing a large sum of money without experience<\/h2>\n

Like any other profession, consistently successful trading takes time.<\/p>\n

Afterall, you can’t expect to start a new job without prior experience and expect to be appointed CEO the next day right?<\/p>\n

Before investing large amounts of your savings into the markets, ensure you have enough experience to know when stay in a trade or leave it.<\/p>\n

\"Risk<\/a><\/p>\n

Nobody wants to experience these 5 ugly trading situations, but don’t worry – help is at hand.<\/p>\n

We’re here to guide you through all the stages of your trading development and offer support<\/a> wherever we can.<\/p>\n